In his first 100 days as European Central Bank President, Mario Draghi has taken unprecedented action to tackle the sovereign debt crisis. Greece may push him even further into unknown territory.
Draghi will today face questions on the ECB
Fewer Americans applied for unemployment benefits last week, indicating the U.S. labor market continues to gradually improve.
Jobless claims dropped by 12,000 to a seasonally adjusted 367,000 in the week ended Jan. 28, the Labor Department said Thursday. That’s near a four-year low.
Economists surveyed by MarketWatch had estimated claims would drop to 370,000. Claims from two weeks ago were revised up by 2,000 to 379,000.
The four-week average of claims fell by a smaller 2,000, to 375,750. The monthly average smooths out seasonal quirks and provides a more accurate assessment of labor market trends, economists say.
The monthly average has shown little change in the past six weeks, but it also remains near a four-year low and stands at a level that usually suggests a healing labor market. Since claims reflect how many people lose their jobs, the recent decline likely indicates a slowdown in layoffs.
“The decline in the claims numbers does point to an improving labor market that will ultimately show up in more jobs,” said Joel Naroff of Naroff Economic Advisors.
Even if most companies aren’t laying off workers, however, that doesn’t mean they are eager to boost payrolls. The current pace of job creation — about 150,000 jobs a month — is far too slow to put millions of unemployed Americans back to work free credit score.
The past week’s claims data are likely to draw more than the usual scrutiny, coming on the eve of U.S. data on nonfarm payrolls and joblessness for January. The economy likely added 125,000 jobs in January and the unemployment rate probably stayed even with December’s 8.5 percent, according to a MarketWatch survey.
Economists say the U.S. would have to add about 250,000 jobs a month for several years to bring unemployment back under 6 percent. The jobless rate ranged between 3.8 percent and 6.2 percent in the seven years before the 2007-2009 recession.
Most economists expect the level of jobless claims to settle in the 375,000 range in the next several months.
Also Thursday, the Labor Department said continuing claims decreased by 130,000 to a seasonally adjusted 3.44 million in the week ended Jan. 21. Continuing claims are reported with a one-week lag.
About 7.67 million people received some kind of state or federal benefit in the week ended Jan. 14, virtually unchanged from the prior week.
World stock markets were mixed Wednesday, as a modest improvement in manufacturing data from China offered reassurance over its economic slowdown, though Asian markets fell back from early gains.
Benchmark oil hovered below $99 per barrel while the dollar rose against the euro but fell against the yen.
In early European trading, Britain’s FTSE 100 advanced 0.8 percent to 5,724.91 and Germany’s DAX both rose 1.1 percent at 6,525.76. France’s CAC-40 jumped 1.3 percent to 3,340.45. Wall Street was set to open higher, with Dow Jones industrial futures rising 0.2 percent at 12,607 and S&P 500 futures gaining 0.2 percent at 1,310.40.
A better-than-expected Chinese manufacturing index for January, issued by a government federation, fueled an early rally in most markets across Asia. But that evaporated after the release later in the morning of a competing, seasonally adjusted survey by HSBC suggesting conditions were still deteriorating.
Tokyo’s Nikkei 225 edged up less than 0.1 percent to close at 8,809.79. Hong Kong’s Hang Seng was down 0.3 percent to 20,333.37 while Seoul’s Kospi added 0.2 percent to 1,959.24.
By afternoon, shares in mainland China had retreated back into negative territory, with the benchmark Shanghai Composite Index shedding 1.2 percent to 2,268.08.
“Rumors that pension funds will not be invested in shares have raised worries over inadequate liquidity,” said Cai Dagui, an analyst at Ping’an Securities, based in Shenzhen.
Shares will likely remain unstable as investors await annual earnings reports, he said.
The mixed signals from China compounded uncertainties over its outlook, showing that despite resilient consumer demand exports remain sluggish payday loans with no fax.
Such concerns are especially acute for Australia, whose economy has thrived on exports of coal, iron ore and other commodities to China.
Australia’s S&P/ASX 200 fell 0.9 percent to 4,225.70, while India’s Sensex edged 0.1 percent higher to 17,208.68.
Taiwan, Indonesia and New Zealand gained ground, though Singapore declined.
Overnight Tuesday, an unexpected drop in U.S. consumer confidence dragged shares down on Wall Street, where the Dow Jones industrial average lost 20.81 points, or 0.2 percent, to 12,632.91. The S&P slipped 0.60 point to 1,312.41 while the Nasdaq composite index rose 1.90 points to close at 2,813.84.
Overall, though, U.S. shares had their best start in 15 years, thanks to a modest improvement in the economy. Sentiment was further buoyed by hopes of progress in Europe after leaders there agreed on the broad outlines of a deal to tie the countries that use the euro closer together and on hopes that Greece is close to a debt-reduction deal with private creditors.
Benchmark oil for March delivery gained 38 cents to $98.85 per barrel in electronic trading on the New York Mercantile Exchange. The contract fell 30 cents to end at $98.48 per barrel in New York on Tuesday.
In currencies, the euro fell to $1.3070 from $1.3084 late Tuesday in New York. The dollar fell to 76.16 yen from 76.20 yen.
Private nonresidential construction may pick up this year, as demand grows for new U.S. projects.
The Architecture Billings Index held at 52 last month, a sign of expansion, according to the American Institute of Architects. The commercial and industrial component — a proxy for private building activity — climbed to 54.1 in December, the highest in 10 months, the Washington-based association said Jan. 18.
The monthly survey of U.S.-based architecture firms is a leading indicator of nonresidential construction, said Kermit Baker, chief economist for the association.
Cass Informations Systems reported fourth-quarter net income of $5.5 million, or 53 cents per share, compared with $5.1 milllion, or 48 cents per share, in the corresponding period of 2010.
For the year, Cass–a Bridgeton-based provider of invoice payment and information services–reported record net income of $23 million, or $2.21 per share, compared with $20.3 million, or $1.95 per share, in 2010.
The U.S. Federal Reserve on Wednesday said it will not raise interest rates until at least late 2014, even later than investors expected, in an effort to support a sluggish economic recovery.
Without making major shifts to its outlook for the economy, the central bank described the unemployment rate as still elevated and said it expects inflation to remain at levels consistent with stable prices.
It depicted business investment as having slowed, dowgrading its assessment from the December meeting.
Economic conditions “are likely to warrant exceptionally low levels for the federal funds rate at least through late 2014,” the central bank said in a statement.
Richmond Fed President Jeffrey Lacker, an inflation hawk who rotated into a voting seat this year, dissented against the decision. He preferred to omit the description of the time period for ultra-low rates.
As part of an effort to provide more insight on its thinking to financial markets and the public, the Fed later on Wednesday will begin publishing individual policymakers’ projections for the appropriate path of the benchmark federal funds rate. That release is scheduled for 2 p.m. (1900 GMT)
If the Fed can convince financial markets it will be on hold longer than they had anticipated, long-term interest rates could drop as investors price in the new information.
“A significant contingent of the committee views this exercise not so much as a process improvement but more as an opportunity to ease again via the forward rate communications channel,” Stephen Stanley, an economist at Pierpoint Securities, said ahead of the Fed’s announcement.
There is also the possibility that officials will announce an explicit inflation target, perhaps a hard marker of 2 percent or a range of 2 percent or a bit below guaranteed online personal loans. The Fed has been debating a statement on its long-run goals, but whether one will be released on Wednesday is unclear.
While forecasters expect the U.S. economy grew at a 3 percent annual rate in the last three months of 2011, they look for growth of just around 2 percent this year.
Fed officials appear likely to bide their time in determining whether more monetary stimulus is needed. Many economists expect they will eventually decide on another spurt of Fed bond buying - probably one focused on mortgage debt.
In response to the deepest recession in generations, the Fed slashed the overnight federal funds rate to near zero in December 2008. It has also more than tripled the size of its balance sheet to around $2.9 trillion through two separate bond purchase programs.
The policy is credited with having prevented an even more devastating downturn, but it has been insufficient to bring unemployment down to levels considered normal during good economic times.
In December, the U.S. jobless rate stood at 8.5 percent, and some 13 million Americans were still actively looking for work but could not find it.
Analysts said the Fed’s shift in communications will put an even greater emphasis on a post-meeting news conference by Fed Chairman Ben Bernanke set for 2:15 p.m. (1915 GMT).
“The chairman is likely to remain non-committal to any additional policy easing, but he is likely to reinforce the Fed’s commitment to ‘review the size and composition of its securities holdings’ and be ‘prepared to adjust those holdings as appropriate,’” said Millan Mulraine, senior macro strategist at TD Securities.
Divers have resumed the search for 21 people still missing after a cruise ship capsized off the Tuscan coast.
Divers were scouring the submerged area of the ship Thursday once officials determined it had stablized after shifting on the rocks a day earlier.
Rough seas were forecast for later in the day, adding an element of uncertainty to the search and plans to begin pumping a half-million gallons of fuel from the vessel.
The missing include a 5-year-old Italian girl and her father. The girl’s mother issued a fresh appeal to speed the search and for passengers who saw the pair to come forward to help determine where they were last seen.
Lee Enterprises Tuesday reported a profit of $14.624 million, or 32 cents per share, for the quarter that ended Dec. 25. That compares to $18.980 million, or 42 cents per share, in the same quarter of 2010.
The newspaper company, owner of the St. Louis Post-Dispatch, said the year-over-year comparison would be positive if not for refinancing costs and other unusual items. Excluding such matters, profits would equal 38 cents per share for the recent quarter, compared to 32 cents a year earlier.
The company filed for bankruptcy last month, submitting a reorganization plan pre-approved by the vast majority of its creditors. Chief Financial Officer Carl Schmidt said the court will be asked to set Jan. 30 as the date to make the plan effective and conclude the bankruptcy.
Operating revenue was down 3.9 percent in the December quarter compared to a year earlier payday loans online. Operating expenses were down 5 percent, excluding unusual items, and the work force was down by 7 percent.
As in earlier periods, the company showed sharp gains in digital advertising while print ads, which make up the bulk of its advertising, continued to decline. Combined print and digital advertising was down 6.1 percent.
CEO Mary Junck said she expects slowly improving revenue trends in 2012. “Our refinancing agreements, along with our continued strong cash flow, will provide a solid financial footing as we continue reshaping Lee for future growth,” said Junck.
Lee, based in Davenport, Iowa, owns 48 daily newspapers, holds an interest in four others, and owns 300 specialty publications in 23 states.
The Federal Reserve on Tuesday drew fire from conservatives for its recent policy proposals on the downtrodden housing sector that the critics argued represented an overreach by the central bank.
Two Republican senators lashed out at the Fed’s “white paper” on housing, which suggested other officials should consider giving failed mortgage finance giants Fannie Mae (FNMA.OB: Quote, Profile, Research, Stock Buzz) and Freddie Mac (FMCC.OB: Quote, Profile, Research, Stock Buzz) a bigger role in turning the market around.
The protests mark a rekindling of anti-central bank sentiment that reached fever pitch when the Fed launched its second round of bond buying in late 2010. At that time, conservatives accused the central bank of sowing the seeds for future inflation, though recent trends show price pressures ebbing.
The Fed’s detractors are now reacting to what they see as central bankers chiming in on fiscal policy matters that are not the appropriate realm for monetary authorities.
“I believe that it is important to the interests of the Federal Reserve, including the independence of monetary policy, that the Fed refrain from providing any hint of activism regarding what are clearly fiscal policy choices,” said Orrin Hatch, the top Republican on the Senate Finance Committee.
“I am sure that the Fed would not appreciate a white paper from Congress outlining how to think about and execute monetary policy,” he said.
Sen. Bob Corker, a member of the Banking Committee, directed his criticism at William Dudley, the influential president of the New York Federal Reserve Bank, for his suggestion that principal write-downs be considered for distressed borrowers.
Such criticisms have some resonance among a minority of inflation hawks at the Fed one hour payday loan. Philadelphia Federal Reserve Bank President Charles Plosser and Richmond Fed chief Jeffrey Lacker have both expressed distaste over an earlier effort by the Fed to drive down mortgage costs by buying mortgage-related debt.
At the other end of the spectrum, Dudley and Eric Rosengren of the Boston Fed have said the central bank should consider further purchases of mortgage-backed securities.
An editorial in the Wall Street Journal on Tuesday was even more scathing, accusing the central bank of “rank electioneering” for issuing the housing proposal.
Fed officials have argued that, given their broad mandate to achieve solid economic growth, it would be irresponsible for them to ignore housing, which continues to be a major drag on the economic recovery.
Recent indicators have been mixed, pointing to some strength in construction but also a continued decline in home prices that bodes ill for a sustained housing rebound.
When Ben Bernanke first took over as chairman at the central bank in 2006, he vowed to steer clear of the type of fiscal debates that got his predecessor, Alan Greenspan, into trouble.
Greenspan had widely been criticized for giving intellectual cover to tax cuts during President George Bush’s administration.
In a letter to leading lawmakers that accompanied the “white paper” last Wednesday, Bernanke said the Fed had received questions and requests for input and that the policy proposals were being made in the “interest of a continuing dialogue.”
Nigerian President Goodluck Jonathan said executive-branch politicians will take a 25 percent pay cut amid labor union plans for a nationwide strike to protest scrapping of fuel subsidies that more than doubled gasoline prices.
The government will reduce overseas traveling and all ministries and departments must cut costs in 2012, Jonathan said, adding that he won